GEO GROUP INC/THE (GEO) Stock Fundamental Analysis
NYSE:GEO - New York Stock Exchange, Inc. - US36162J1060 - Common Stock - Currency: USD
GEO gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 83 industry peers in the Commercial Services & Supplies industry. While GEO is still in line with the averages on profitability rating, there are concerns on its financial health. GEO is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
GEO had positive earnings in the past year.
In the past year GEO had a positive cash flow from operations.
Each year in the past 5 years GEO has been profitable.
In the past 5 years GEO always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 1.34%, GEO is in line with its industry, outperforming 51.81% of the companies in the same industry.
GEO's Return On Equity of 3.65% is in line compared to the rest of the industry. GEO outperforms 56.63% of its industry peers.
GEO's Return On Invested Capital of 8.87% is fine compared to the rest of the industry. GEO outperforms 71.08% of its industry peers.
The Average Return On Invested Capital over the past 3 years for GEO is below the industry average of 10.74%.
The 3 year average ROIC (7.94%) for GEO is below the current ROIC(8.87%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.34% | ||
| ROE | 3.65% | ||
| ROIC | 8.87% |
ROA(3y)2.34%
ROA(5y)2.22%
ROE(3y)7.12%
ROE(5y)8.19%
ROIC(3y)7.94%
ROIC(5y)6.71%
1.3 Margins
With a Profit Margin value of 1.61%, GEO perfoms like the industry average, outperforming 54.22% of the companies in the same industry.
GEO's Profit Margin has declined in the last couple of years.
GEO has a Operating Margin of 12.86%. This is amongst the best in the industry. GEO outperforms 80.72% of its industry peers.
GEO's Operating Margin has been stable in the last couple of years.
Looking at the Gross Margin, with a value of 26.84%, GEO is doing worse than 60.24% of the companies in the same industry.
In the last couple of years the Gross Margin of GEO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.86% | ||
| PM (TTM) | 1.61% | ||
| GM | 26.84% |
OM growth 3Y0.06%
OM growth 5Y1.08%
PM growth 3Y-26.63%
PM growth 5Y-28.78%
GM growth 3Y-1.24%
GM growth 5Y1.46%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so GEO is still creating some value.
GEO has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, GEO has more shares outstanding
The debt/assets ratio for GEO has been reduced compared to a year ago.
2.2 Solvency
GEO has an Altman-Z score of 2.36. This is not the best score and indicates that GEO is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of GEO (2.36) is comparable to the rest of the industry.
GEO has a debt to FCF ratio of 10.47. This is a negative value and a sign of low solvency as GEO would need 10.47 years to pay back of all of its debts.
The Debt to FCF ratio of GEO (10.47) is comparable to the rest of the industry.
GEO has a Debt/Equity ratio of 1.28. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.28, GEO is doing worse than 71.08% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.28 | ||
| Debt/FCF | 10.47 | ||
| Altman-Z | 2.36 |
ROIC/WACC1.02
WACC8.74%
2.3 Liquidity
GEO has a Current Ratio of 1.47. This is a normal value and indicates that GEO is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.47, GEO is in line with its industry, outperforming 40.96% of the companies in the same industry.
A Quick Ratio of 1.47 indicates that GEO should not have too much problems paying its short term obligations.
The Quick ratio of GEO (1.47) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.47 | ||
| Quick Ratio | 1.47 |
3. Growth
3.1 Past
The earnings per share for GEO have decreased strongly by -13.79% in the last year.
GEO shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -30.77% yearly.
The Revenue has grown by 25.53% in the past year. This is a very strong growth!
Measured over the past years, GEO shows a decrease in Revenue. The Revenue has been decreasing by -0.44% on average per year.
EPS 1Y (TTM)-13.79%
EPS 3Y-19.54%
EPS 5Y-30.77%
EPS Q2Q%-55.17%
Revenue 1Y (TTM)25.53%
Revenue growth 3Y2.41%
Revenue growth 5Y-0.44%
Sales Q2Q%-0.09%
3.2 Future
The Earnings Per Share is expected to grow by 79.21% on average over the next years. This is a very strong growth
GEO is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 15.03% yearly.
EPS Next Y59.2%
EPS Next 2Y79.21%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year9.84%
Revenue Next 2Y15.03%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 37.53, GEO can be considered very expensive at the moment.
GEO's Price/Earnings ratio is in line with the industry average.
The average S&P500 Price/Earnings ratio is at 28.29. GEO is valued slightly more expensive when compared to this.
A Price/Forward Earnings ratio of 23.58 indicates a rather expensive valuation of GEO.
GEO's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. GEO is cheaper than 62.65% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of GEO to the average of the S&P500 Index (21.32), we can say GEO is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.53 | ||
| Fwd PE | 23.58 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GEO indicates a somewhat cheap valuation: GEO is cheaper than 60.24% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of GEO is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.59 | ||
| EV/EBITDA | 11.39 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
GEO's earnings are expected to grow with 79.21% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.63
PEG (5Y)N/A
EPS Next 2Y79.21%
EPS Next 3YN/A
5. Dividend
5.1 Amount
GEO does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
28.15
-1.54 (-5.19%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners88.5%
Inst Owner Change0.29%
Ins Owners1.55%
Ins Owner Change8.84%
Market Cap4.02B
Analysts82.5
Price Target45.7 (62.34%)
Short Float %6.75%
Short Ratio3.01
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-29.94%
Min EPS beat(2)-44.81%
Max EPS beat(2)-15.06%
EPS beat(4)1
Avg EPS beat(4)-7.11%
Min EPS beat(4)-44.81%
Max EPS beat(4)38.86%
EPS beat(8)2
Avg EPS beat(8)2.17%
EPS beat(12)5
Avg EPS beat(12)2.95%
EPS beat(16)9
Avg EPS beat(16)13.53%
Revenue beat(2)0
Avg Revenue beat(2)-1.79%
Min Revenue beat(2)-2.63%
Max Revenue beat(2)-0.95%
Revenue beat(4)0
Avg Revenue beat(4)-1.33%
Min Revenue beat(4)-2.63%
Max Revenue beat(4)-0.69%
Revenue beat(8)2
Avg Revenue beat(8)-0.62%
Revenue beat(12)5
Avg Revenue beat(12)0.02%
Revenue beat(16)6
Avg Revenue beat(16)-0.17%
PT rev (1m)8.74%
PT rev (3m)53.42%
EPS NQ rev (1m)-0.53%
EPS NQ rev (3m)-23.76%
EPS NY rev (1m)-25.27%
EPS NY rev (3m)-23.93%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.55%
Revenue NY rev (1m)-0.07%
Revenue NY rev (3m)-2.22%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.53 | ||
| Fwd PE | 23.58 | ||
| P/S | 1.33 | ||
| P/FCF | 24.59 | ||
| P/OCF | 16.6 | ||
| P/B | 3.01 | ||
| P/tB | 8.89 | ||
| EV/EBITDA | 11.39 |
EPS(TTM)0.75
EY2.66%
EPS(NY)1.19
Fwd EY4.24%
FCF(TTM)1.14
FCFY4.07%
OCF(TTM)1.7
OCFY6.02%
SpS21.21
BVpS9.35
TBVpS3.17
PEG (NY)0.63
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.34% | ||
| ROE | 3.65% | ||
| ROCE | 11.83% | ||
| ROIC | 8.87% | ||
| ROICexc | 9.09% | ||
| ROICexgc | 12.53% | ||
| OM | 12.86% | ||
| PM (TTM) | 1.61% | ||
| GM | 26.84% | ||
| FCFM | 5.4% |
ROA(3y)2.34%
ROA(5y)2.22%
ROE(3y)7.12%
ROE(5y)8.19%
ROIC(3y)7.94%
ROIC(5y)6.71%
ROICexc(3y)8.16%
ROICexc(5y)7.05%
ROICexgc(3y)11.32%
ROICexgc(5y)9.67%
ROCE(3y)10.59%
ROCE(5y)8.94%
ROICexcg growth 3Y8%
ROICexcg growth 5Y5.13%
ROICexc growth 3Y6.92%
ROICexc growth 5Y4.53%
OM growth 3Y0.06%
OM growth 5Y1.08%
PM growth 3Y-26.63%
PM growth 5Y-28.78%
GM growth 3Y-1.24%
GM growth 5Y1.46%
F-Score5
Asset Turnover0.83
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.28 | ||
| Debt/FCF | 10.47 | ||
| Debt/EBITDA | 3.32 | ||
| Cap/Depr | 62.34% | ||
| Cap/Sales | 2.6% | ||
| Interest Coverage | 2.04 | ||
| Cash Conversion | 46.97% | ||
| Profit Quality | 335.87% | ||
| Current Ratio | 1.47 | ||
| Quick Ratio | 1.47 | ||
| Altman-Z | 2.36 |
F-Score5
WACC8.74%
ROIC/WACC1.02
Cap/Depr(3y)62.7%
Cap/Depr(5y)64.04%
Cap/Sales(3y)3.35%
Cap/Sales(5y)3.55%
Profit Quality(3y)310.14%
Profit Quality(5y)305.57%
High Growth Momentum
Growth
EPS 1Y (TTM)-13.79%
EPS 3Y-19.54%
EPS 5Y-30.77%
EPS Q2Q%-55.17%
EPS Next Y59.2%
EPS Next 2Y79.21%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)25.53%
Revenue growth 3Y2.41%
Revenue growth 5Y-0.44%
Sales Q2Q%-0.09%
Revenue Next Year9.84%
Revenue Next 2Y15.03%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y10.55%
EBIT growth 3Y2.47%
EBIT growth 5Y0.63%
EBIT Next Year67.35%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-22.83%
FCF growth 3Y-8.46%
FCF growth 5Y-5.84%
OCF growth 1Y-14.98%
OCF growth 3Y-5.01%
OCF growth 5Y-6.45%